Host: Steve Hastings, Anglepoint Global Sales Leader
Speakers: Kris Johnson, Anglepoint Chief Product Officer
In this episode of the ITAM Executive, Kris Johnson, Anglepoint CPO, and Steve Hastings, Global Head of Sales, discuss the 2023 Gartner® Magic QuadrantTM for SAM Managed Services report.
Kris gives a brief overview of the report and how Gartner measures each Managed Service Provider (MSP). He also touches on the specific requirements each MSP has to meet and the evaluation process.
One of the main topics of conversation is about what’s new to this years report – FinOps and Green IT are a couple examples.
Finally, and perhaps most importantly, Kris and Steve discuss how end user organizations could use the Magic Quadrant report to evaluate potential Software Asset Management or IT Asset Management Managed Service Providers.
By listening to this episode, you’ll learn about:
- The Magic Quadrant inclusion criteria, evaluation criteria, and main categories of evaluation
- The role of Green IT and FinOps in this year’s Magic Quadrant and why their inclusion matters
- How ITAM managers can leverage Gartner research to make stronger business cases for MSP selection
- And more
Welcome back to the ITAM Executive Podcast. We’re excited to be with you today. I’m Steve Hastings. I’m Anglepoint’s Global Sales Leader. I’m here with Kris Johnson, Anglepoint’s Chief Product Officer, and we are very excited to be here today to talk more about Gartner’s Magic Quadrant for SAM Managed Services, which just dropped today.
If you haven’t seen it yet, we’re very grateful to be recognized again as a Leader in that Magic Quadrant. And although of course, Gartner doesn’t endorse any providers. So everything we say today is our own opinions. But if you are interested in reading that research, it’s available for free on anglepoint.com/mq.
You can go there and get a free copy anytime that you want. But Kris, we’re very excited for the new newest edition of the Gartner Magic Quadrant.
Yeah, it’s good to be here. Exciting time certainly for Anglepoint. The Magic Quadrant really is a useful research tool for anyone looking to differentiate services providers in the industry.
There’s a lot of good detail there that Gartner provides and off the back of the Magic Quadrant will be the Critical Capabilities as well, which goes into further detail on a number of areas. We encourage everyone to check it out.
Yeah, definitely go check that out. If you if you have a minute, maybe for those people who don’t know as much about Gartner’s Magic Quadrant or about what the research is about, maybe you can talk a little bit about what’s included in a Gartner Magic Quadrant.
What is the Magic Quadrant? What are the different areas that are in there to orient some of our watchers or listeners about that?
Yeah, it’s an interesting process. Having gone through it now four times, Gartner is very methodical in how they go about it. The inclusion criteria that are sent out every year.
Providers have to meet certain, revenue criteria, distribution of revenue from a geographic standpoint. And how it’s broken out by types of services and the frequency of those services to qualify as a managed service. All of those things. So, there’s some pretty rigid standards to be able to be evaluated as part of the Magic Quadrant.
And then, the process then starts once you’re included to respond to a welcome packet that’s sent out, that goes through the evaluation criteria and how they’re weighted high, medium, low. There are essentially three specific categories that you’ll see in the writeup itself.
But it’s looking at the vision of the managed services provider, the critical capabilities of the managed services provider, and then of course the ability to execute. As part of that, and, based on those criteria and the weights that they have ascribed to them that’s how they mathematically come up with their plot points on the quadrant itself.
And it determines the relative positions of the providers.
Have you seen those criteria and those weights change over time? As we’ve now. Now this is the fourth iteration of this particular Magic Quadrant. Have you seen over time that those metrics have changed?
Yeah. Not fundamentally from like their foundation, which is good because they’re, I think they’re all very relatively comparable to each other.
But yes, each year there is an evolution as you would expect the industry is evolving, that the criteria to evaluate leaders in that industry to shake out. And I would say this year we probably saw one of the more significant changes in the four-year history. The other ones were a little bit more incremental.
And that was with more specific focus on FinOps and cloud cost management services, cloud license management as well as green IT and environmental sustainability-oriented services being called out specifically.
As well as I’ll mention the continuous delivery platform. So it’s now part of the criteria to have a digital platform through which you deliver your services, which for our purposes as Anglepoint, we’ve had that for years and years. It was nice to actually see it included as part of the criteria this year and see heavily we weighted.
Can you talk about some of the, kind of the evolution of that?
Do you think that the Gartner Magic Quadrant is an important part of moving this industry forward in terms of software asset management, IT asset management. How does the Magic Quadrant help to push some of those things?
Yeah, great question. The first of all, the researchers themselves they have their own interviews that they do customer or client discussions that they’re having throughout the year.
So they have a pretty good, broad perspective, just from feedback from all of those inquiries. And their thought leadership and their research also reflects how they’re seeing the industry evolve and change based off some of that feedback as well as their own look into the future.
And yeah, I think anyone reading the research will find that there’s certain points that resonate more with them. Obviously, there’s the Gartner survey instruments that are incorporated into that as part of the research. So yeah, I think, it’s I think it’s both sides, right?
They’re getting a pulse on the industry and they’re looking into the future a bit to see how that’s evolving and they can, they’ve got a good vantage point to see where things are moving. And as well as, helping to evolve the industry by providing those insights and providing that forecasted look to help shape what that future looks like for all of us.
I was going to ask like, how much of the Magic Quadrant plots, and the scoring is based on feedback from customers and industry specific feedback versus feedback that they get from us, the providers.
Yeah. During this process I think it’s a healthy mix. Okay. I chuckle inside a little bit because we spend so much effort on the preparation of the materials.
There’s a lot of data that they request, financial data, personnel data, geographic distribution data, client data, account level of data. And so it takes a lot of effort for us to respond to that, as well as the briefing itself, which is 75 minutes of presentation according to specific things that they’re asking to see.
We put a lot of time and effort in preparing those materials. I would like to think that you know that heavily influences. Yeah. Cause we put so much into it. Certainly, the data is exactly what they’re looking for and it’s the objective criteria they’re evaluating. But I would have to admit that I think a lot of what comes out of the evaluation is actually based in the client feedback, which is good. Yeah. Because it’s right from, the client sources themselves. It’s a little disheartening as someone that spends so much time in the preparation of the materials. You want them to value those at least as much as some of the other areas of feedback that they get. But I think it’s a healthy balance of both.
Yeah, certainly Gartner has the inquiries from their clients that they can that they can use to help evaluate. And then they also have the anonymous Gartner Peer Insights reviews as well.
Peer Insights and then they conduct interviews of clients as well. So yeah, we’re trying to give them a clear, open, transparent view of who Anglepoint is, what we do, how we do it, where we’re evolving, what we’re investing in, and want them to have open and honest discussions with us, with our clients, and anonymous feedback from the Peer Insights.
The more I think sources they can corroborate to get a real full view of a managed services provider, the better.
Yeah, I agree. Can you talk a little bit about the quadrant itself? I know there’s the completeness of vision axis. There’s the ability to execute axis, and then there’s the four quadrants.
Can you talk about what it means to be, for example, a leader versus a challenger, or a leader versus a visionary or something like that?
Yeah, to some degree it’s a little self-explanatory, right? The more complete your vision is and that’s how that vision aligns with how Gartner reviews the market your ability to execute.
Obviously the higher you are in the ability to execute, the further you are on the completeness of vision the better. But it doesn’t necessarily mean that there’s not good services to be had by, people or providers that are in some of these other areas of the quadrant. They may be, more focused in one niche versus another.
Although the inclusion criteria require you to have a geographic diversity and a scale of a certain size, so you can’t be too niche. But yeah, they outline it in terms of, niche players that have a relatively low. And it’s important to recognize it’s a relative score, right?
Relative to the other options or providers out there. Their ability to execute may be comparatively low, and their completeness of vision is comparatively low. So those would be the niche players in the bottom left.
Those that have maybe a higher ability to execute, but more of a narrow vision, Gartner labels them challengers that may not be aligned to where Gartner sees the market moving. So, they might be stagnated or stuck in a certain area so to speak. Or at least not making investments to where things are headed. So those would be in the top left.
And then opposite that is the visionaries that may have a good view of the market, but their ability to actually execute and serve that market are relatively low. So, these are the visionaries that have a good view, but maybe you don’t have quite what it takes to kind of execute against that vision. And those would be the visionaries in the bottom right?
And then of course, the leaders are those that are high on both scales relative to the others. And that’s where we have been in the last four years. And have been fortunate to be able to maintain our position there and work very hard to maintain a high degree of ability to execute across the globe across a wide variety of services that go into managed service, as well as being thought leaders in our industry to help evolve the industry in a number of different ways to make sure that we’re evolving as the market does.
I was going to ask, what does it, what do you think it takes to maintain that leader position throughout the course of now four years? That’s quite a feat. Can you talk a little bit about what it takes to maintain that position and not move and not move to any of the other quadrants?
Yeah. I think if there was a formula for it, I’m not sure I can like definitively answer that question. What does it take? It takes, I can tell you what it has taken Anglepoint. It requires everybody in the entire company to be aligned to making sure that everything that we do is market leading.
We try and be the best in the world at what we do and to achieve outcomes for our clients that really demonstrate the value of our services. And constantly asking our clients for feedback and adjusting our services mixed, depending on where they’re going to get more value. So, I think what it takes or what it’s taken for us is like never settling.
Never resting on any laurels that we might perceive that we have and constantly challenging ourselves and the status quo as well as always looking at the forefront and where the market is shifting.
We present in industry conferences. We obviously read a lot of industry research. We’re involved in the development of ISO standards and FinOps standards and the intersection of ITAM and FinOps and Green IT and TBM and all these things that we talk about a lot, and create services around. It’s constantly never being satisfied with our last project.
We realize we’re only as good as our last deliverable and never settling for anything less than our best.
Yeah, I was going to say, it’s a lot of this is very, for us at least, it’s very client driven. A lot of the feedback that we get from clients, a lot of the evolution of our client engagements and what we do with clients really informs where the industry’s going, and we really try to be industry leading and all of that.
You and I had a conversation. We spent some time together a couple weeks ago. And shared some mutual frustrations with the RFP process. Yeah, I remember we recorded a podcast. Maybe we can link to it in the description about how, Organizations that are trying to select a managed services provider, right?
How to go about that from an RFP process, there’s a better way to do it. I sincerely hope that anyone that’s in the market for a managed services provider reads the Magic Quadrant, reads the critical capabilities research so that you’re a more informed buyer and selector of services.
Because we continue to this day to see a lot of RFP requests and RFI requests that may, they’re maybe not asking the best questions to really arrive at differentiation between providers. And we always like smart informed buyers. And these research tools are good tools.
If you’re An ITAM manager or a director or a leader of an ITAM group within an end user organization.
You want to use the Gartner research to help further your case, or maybe you’re out there in the market for a software asset management managed services provider, and you’re looking to help build the case to bring on a provider or get budget from senior executives. How can the Gartner research specifically the Magic Quadrant to help with that business case?
It lays out criteria, critical capabilities that you want to look for. And you might ask yourself, oh, is this something that I should be including in the scope of the request for proposals? I hadn’t considered Sustainability, for example, as an ITAM relative initiative.
Or maybe you’re not asked internally to have that in your remit yet, but maybe you should, maybe you should be reading up on it, seeing where the market is going see what regulations in your country and jurisdiction might be coming to you soon. So, I think it’s good to have a well-rounded business case, right?
It’s not just about optimizing software costs. It’s also about optimizing cloud costs and optimizing your carbon footprint with as far as your IT is concerned. So there’s multiple facets rather than maybe a single dimension that some people might only have in mind.
And we don’t have too much time today, but I wanted to just ask some of these new initiatives or new things that are coming out that Gartner’s starting to evaluate providers on. You mentioned sustainability, for example, in IT. You mentioned of course FinOps is a very hot topic right now.
Can you maybe talk a little bit about one or both of those things and maybe what Anglepoint it’s doing in those areas or if you are looking for a provider, what’s the kinds of things that you ought to be? Asking about in terms of some of these new areas that maybe ITAM people haven’t looked at before.
Yeah. When it comes to green IT a lot of CIOs and CEOs, actually in fact Gartner had a study on the top 10 initiatives of CEOs and sustainability was on that top 10 list. And you can bet if it’s a priority of the CEO it’s going to be a priority of the CIO.
Since about 25% of carbon emissions come from the IT department or technology generally depending on the industry. And organizations are being more conscientious of the impact that their operations are having on the earth and greenhouse gas emissions in particular.
And there may very well be reporting obligations that the organization is under or will be under very soon to report on their scope two and scope three greenhouse gas emissions including for IT. As far as Anglepoint goes, we’ve been providing reporting services on what your carbon emissions are for scope two and scope three. We also do education services so that your infrastructure folks, for example, understand how to apply those protocols, the Greenhouse Gas emission protocols for IT. There’s not a lot of resources out there that specifically spell that out for an IT executive.
And then we obviously do reporting from both a hardware and software standpoint what the carbon footprint is, carbon consumption, and then also, when we do our risk and opportunity assessment reports from a licensing standpoint. Not only are you able to save money by reconfiguring or, moving on-premises workloads to the cloud and achieve cost savings, but you also receive carbon savings as well. And it’s something that we’re providing more and more as an extension of our deliverables.
From an ITAM standpoint, do we show some of those deliverables to Gartner as part of the process for the Magic Quadrant?
What do they see? What do they get to see?
Yeah. We provide sample anonymized obviously deliverables to Gartner to show them exactly. Here’s a client example for a sustainability report for Green IT. Here’s an example of net carbon savings based off this risk and opportunity assessment report for moving these SQL workloads from on-premises to the cloud.
Yeah, we, again, it’s very transparent. We want to show them exactly what we’re doing and be very transparent about it.
On the FinOps front. Yeah a number of things there. We look at it from a holistic standpoint. A lot of providers that we know in the marketplace are focusing, pretty much solely on cost takeout.
Okay. It certainly has its place to right size cloud consumption, right size rates. But and we of course do those services to provide the spend visibility, to provide the agreement, renewal support help them get the right mix of reserved instances and cloud savings plans.
But also look at how to help an organization adopt FinOps throughout the organization, including within independent business units within different DevOps functions to really help the cloud center of excellence come into its own and be productive in helping these independent DevOps groups coalesce around standards and code sharing and code repository and things like this.
We also look at some of the, looking at, if there’s a standard for tagging, for example, the labeling of cloud resources so that you can manage your infrastructure through code to identify cost centers, for example. So you can do, unit economics and charge back from a costing standpoint.
Tying it to applications and so forth. We do essentially a tagging audit or take a look, how well are your key value pairs formed? Is there variability? Are there some environments that aren’t getting tagged properly? And what is the impact of those, how much spend does that represent that you’re not really able to optimize or at least show charge back or show back? From that standpoint. A lot of different services in addition to just the cost takeout optimization services.
Looking at it from a governance standpoint, from a organizational excellence standpoint as well, if you have ITAM leaders who are wanting to bring some of this into their remits, for example, FinOps or sustainability, or things that maybe weren’t traditionally within the remit of an ITAM department, but are moving into that direction. How would one use some of this Gartner research or other ways to help bring some of that into their remit?
Yeah, good question. The write-ups on the Critical Capabilities is going to be very important because there are use cases specifically around FinOps and cloud license management.
That they can, have an insight into how all these providers are differentiated. It’s important, for someone in the ITAM industry that’s looking to do more from a FinOps standpoint to build those bridges with the head of the cloud center of excellence if it’s not within their director met and speak the language of DevOps people that you know, and provide visibility and reporting that’s valuable to them, for them to be able to make informed decisions.
It’s very much a collaborative effort instead of a command and control-type environment. So, it’s important to go into it with that sort of collegial attitude and mindset and build those bridges and at the end of the day provide value to those groups to make informed decisions that are going to benefit the organization as all.
Yeah, that’s really interesting. It feels like that if you’re evaluating SAM managed service providers or ITAM managed service providers, that these need to be really key topics that you need to address with them to make sure that there are products and services you can take advantage of to help further that goal within your organization.
Yeah, I think it speaks to something that we had discussed on that prior podcast episode about in selecting amended services provider, you’re really selecting a long-term partnership, right? I’m sure there might be some short-term goals that you’re wanting their help to achieve. But do you want, a niche player that is only going to help you with that one thing, or do you want a partnership with an organization a provider that’s going to help you evolve your program?